Property Taxes Law Guide – Revision 2012

Revenue and Taxation Code

Property Taxation

Part 0.5. Implementation of Article XIII A of the California Constitution

Chapter 2. Change in Ownership and Purchase

Section 66

66. Vesting of employee benefit plan. Change in ownership does not include any of the following:

(a) The creation, vesting, transfer, distribution or termination of a participant's or beneficiary's interest in an employee benefit plan.

(b) Any contribution of real property to an employee benefit plan.

(c) Any acquisition by an employee benefit plan of the stock of the employer corporation pursuant to which the employee benefit plan obtains direct or indirect ownership or control of more than 50 percent of the voting stock of the employer corporation.

As used in this section, the terms "employer," "employee benefit plan," "participant," and "beneficiary" shall be defined as they are defined in the Employee Retirement Income Security Act of 1974.

History.—Stats. 1986, Ch. 497, effective January 1, 1987, added "any of the following" after "include" in the first sentence, substituted "." for "; or" after "plan" in subdivision (a), added subdivision (c), and added "employer," after "terms" in the first sentence of the second paragraph. Stats. 1999, Ch. 941 (SB 1231), in effect January 1, 2000, substituted "does" for "shall" after "Change in ownership" in the first sentence of the first paragraph, and substituted "ownership or control of more than 50 percent of the voting stock of" for "control, as defined in Section 25105, in" after "direct or indirect" in the first sentence of subdivision (c).

Note.—Section 2 of Stats. 1986, Ch. 497, provided that the amendments to Section 66 of the Revenue and Taxation Code made by this act shall be effective for the 1979–80 fiscal year and fiscal years thereafter. It is the intent of the Legislature that these amendments shall apply to the determination of new base year values for the 1979–80 fiscal year and fiscal years thereafter with respect to any transfer occurring on or after March 1, 1975. However, no refunds shall be made for any fiscal year preceding the applicable period provided in Section 5097 of the Revenue and Taxation Code. Sec. 3 thereof declared that Section 1 of this act does not constitute a change in, but is declaratory of, the existing law. Sec. 4 thereof provided that reimbursement to local agencies and school districts for costs mandated by the state pursuant to this act shall be made.

Tax injunction act.—ERISA's grant of exclusive jurisdiction was not intended as an exception to the Tax Injunction Act. Thus, where an ERISA plan trustee failed to show that it could not raise the issue of ERISA preemption of state tax in a state court, as required to invoke "lack of plain, speedy and efficient state remedy" exception to the Act's prohibition on enjoining, suspending, or restraining assessment of a state tax, the Act barred a federal court action. Chase Manhattan Bank, N.A. v. San Francisco, 121 F.3d 557.